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Impact Investing

An investment strategy that balances fiduciary responsibility with achieving significant social and environmental impacts offers a critical lever to support and amplify the Partnership’s policy advocacy and field-building activities, as well as efforts by partners and others to invest in the development of healthy places. Impact investing can advance inter-connected solutions, engage market forces, be catalytic, and accelerate and scale results. It is based on the acknowledgment that grants alone cannot supply the type and scale of capital needed to transform low-income communities and communities of color.

Place-based impact investing has a strong track record and is gaining additional significance as foundations emphasize the importance of place to health, economic opportunity, and community development and as they acknowledge the importance of advancing equity in light of the nation’s widening income and asset disparities. In addition to advancing social outcomes, the impact-investing field has spawned a growing class of specialized investment intermediaries and funds, such as community development financial institutions (CDFIs), to implement impact investments that have generated economic opportunities in the form of jobs, affordable housing, and community and financial services in low-income communities across the country. Today, impact investors are fueling emerging pay-for-success strategies (social impact bonds); sustainable agriculture and food systems; transit-oriented development; and venture capital for technology innovation in health, education, and energy. However, this field is still young and its integration of equity in decision making as well as evaluation is very varied and quite nascent.

The Convergence Partnership recognizes the promise and timeliness of impact-investing opportunities to expand its circle of influence, leverage the strengths of philanthropy and private and public sectors, replicate promising models, and amplify and accelerate results — all to promote equitable communities where all people have access to the resources for healthy, prosperous, and fulfilling lives. The Partnership is currently exploring an effective approach to contribute to and add value to the social impact-investing field. This will require several steps and elements:

Promotion and advocacy: Promote effective policy and equity measures that advance the practice of impact investing as a strategy for advancing healthy people and healthy places.

Field building: Create and disseminate tools that support investors in determining equity-focused investments and in measuring and reporting progress toward equity impacts.